TAs it continues its plan to renovate and reposition the Colonie Center (pictured) in Albany, N.Y., Feldman Mall Properties Inc., now has additional financing funded by the closing of a joint venture with an affiliate of Heitman Funds.
As it continues its plan to renovate and reposition the Colonie Center (pictured) in Albany, N.Y., Feldman Mall Properties Inc., now has additional financing funded by the closing of a joint venture with an affiliate of Heitman Funds.
Heitman's initial contribution will be 75 percent of the mall's reported $101.5 million value. Feldman Mall Properties, a Great Neck, N.Y.-based REIT, will retain 25 percent of the total equity. The company has also refinanced its $50.7 million first mortgage bridge loan with a new $109.8 million construction loan facility. The new loan, which matures in October 2008 but can be extended by two years, has an all-in fixed interest rate of 6.84 percent.
Feldman Mall Properties, which bought the 1.3 million square-foot, two-level shopping center in February 2005, will be the managing member of the joint venture. It will receive fees for handling management, leasing and construction at the Wolf Road property.
Larry Feldman, chairman & CEO, said in a release that the deal is consistent with the REIT's business plan of using joint ventures to maximize return on equity by reducing its equity investment--while it receives current fee income and possible future promoted equity. The REIT, which focuses solely on renovating and repositioning regional shopping malls, plans to upgrade the exterior and interior to attract new tenants, including restaurants and entertainment facilities. It recently received local approval to begin its 100,000-square-foot addition. Feldman Mall Properties has already added five new tenants: LL Bean, Barnes & Noble, The Cheesecake Factory, PF Chang's China Bistro and a 14-screen Regal Entertainment theater. The mall, located in the heart of upstate New York's Capital Region, already has Macy's, Sears, Boscov's and Christmas Tree Shops as anchors and an occupancy rate of approximately 83 percent, according to the company's Web site.
Feldman Mall Properties, which trades as FMP, recently reported revised second quarter net income based on an increase to the gain on the partial sale of the Foothills Mall in Tucson, Ariz. In mid-August, the company reported a $29.9 million gain, up from its previously stated estimate of $24.7 million. The revision increased the company's net income for the second quarter ending June 20, to $1.66 per fully diluted share and for the first half of the year to $1.56 per fully diluted share. The REIT has seven malls in its portfolio with about 7 million square feet of space.
